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Matching Funds: Pro or Con?

October 10, 2008
by Daniel Guarnera
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SAMHSA has been asking for comments on a new proposal to require grantees for some of its programs. The proposal suggests a 20% match (either financially or in-kind) for grantees of three SAMHSA programs in FY 2009, two Targeted Capacity Expansion programs for emerging trends in prevention and mental health, and the Center for Substance Abuse Treatment's Screening, Brief Intervention, and Referral to Treatment (SBIRT) program. More details about the proposal can be found here (the deadline for comments is officially today, but for what it's worth, Monday's a federal holiday).

A number of national organizations (including NAADAC) have submitted comments opposed to the proposal. The main arguments include: (1) the current economic crisis makes it extremely difficult for non-profits, businesses, and foundations to provide matching funds, (2) state and local governments are in financial disarray, meaning they can't provide support either, (3) rural areas are put at a particular disadvantage because there are fewer potential funders, (4) matches will deter many otherwise eligible grantees from even applying, thereby reducing the diversity of applicants and limiting the creativity and innovation of the programs that are funded.

The SAMHSA notice makes the case for matching funds: (1) they can improve the sustainability of a program once the federal grant ends, (2) they encourage a broader base of community support for the program, and (3) they allow agencies to support more total programs, even if at a lesser amount.

What are your thoughts on matching funds? What pros and cons did I leave out? If matching funds are inevitable, what's the best way to design them?

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Daniel Guarnera

Daniel Guarnera is the Director of Government Relations for NAADAC, The Association for...